Lottery officials allege Scott and Jennifer Brandhorst redeemed the forged TouchPlay tickets at a Hy-Vee store in Cedar Rapids, one for $300 and another for $325. Cedar Rapids police reportedly matched the couple with a surveillance video.

Investigators arrested the pair as they were leaving their home at 1868 Dakota Ave. in Waverly on Monday. They were taken to the Linn County Jail.

The Brandhorsts are charged with forgery and fraud of a lottery ticket, a Class D felony. The crime carries a potential prison term of up to five years.

Iowa Lottery CEO Ed Stanek said the arrests will serve as deterrents. The Lottery says over its 20-year history, more than 80 percent of suspected fraud and theft cases have been solved.

Stanek said there have been attempts through the years to forge or alter lottery tickets in attempts to claim fraudulent prizes. In fact, on the Iowa Lottery's first day of operations on Aug. 22, 1985, someone tried to forge an instant-scratch ticket to claim a $5,000 prize, he said.

"We dealt with that case at the time and have continued to aggressively investigate any instances of suspected foul play involving lottery products," Stanek said. "It is the lottery's responsibility to ensure a secure environment for its operations and the sale of its games."

Stanek emphasized that while no system is fool-proof, the lottery's security measures have been extremely effective, with more than 80 percent of suspected fraud and theft attempts involving lottery tickets being solved in the lottery's 20-year history.

"The lottery must constantly guard against new fraud attempts," Stanek said. "Our security department works closely with local law enforcement around the state and the Division of Criminal Investigation in the enforcement of gaming laws.

"We believe the strong record that has been built speaks to the cooperation and effective investigations we have achieved through the years," he said.

The tickets were redeemed at 12 Git n'Go locations between Jan. 17 and Jan. 19 in Des Moines, Norwalk and Pleasant Hill.

Video surveillance tapes show the same suspect in each location. The suspect is a white man in his late 20's or 30's who wears glasses and has short dark hair. In the video, he was seen wearing a trench coat. The total loss at the 12 Git n'Go locations was $2,871.75.

Background

TouchPlay machines have been in operation in Iowa since May 2003. In addition to creating a valuable revenue stream for the state, TouchPlay has given the lottery the opportunity to work with dozens of small business owners. The lottery is partnering in the deployment of TouchPlay machines with amusement operators who already provide dartboards, pool tables and other machines in businesses throughout Iowa.

All parties involved in the TouchPlay project receive a share of the net revenue from TouchPlay machines (net = sales - prizes). The Lottery's share of the net is the same from retailer to retailer and is established on a calendar-year basis. For the current calendar year, the Lottery receives 24 percent of the net revenue from TouchPlay and that figure will increase to 34 percent by calendar year 2009.

The rest of the net revenue from each machine is split by the machine manufacturer, the retailer who purchases the machine and the business location where the machine is installed. The Lottery does not establish payment levels for those three parties, and instead, leaves that determination open to negotiation among them.

The lottery estimates that for the current fiscal year, the TouchPlay project will generate about $30 million in revenues for the state; and about $45 million in FY 2007.

Since the Iowa Lottery's inception in 1985, more than $1.9 billion has been awarded in prizes and more than $950 million has been raised for state programs

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